Elan Miller, Deputy Portfolio Manager at Sydney-based Blackwattle Investment Partners, which oversees nearly $350 million in assets, shared insights on the current earnings season and investment strategies. Miller noted that companies have generally delivered net profit beats, leading to upgrades in forward earnings per share expectations, particularly in the banking, property, and materials sectors. He attributes this to resilient commodity prices and a stronger-than-expected Australian economy, with sustained consumer spending and positive business lending growth.
Addressing market volatility, Miller sees it as an opportunity to selectively acquire high-quality companies at attractive prices. He highlighted CAR Group, a company that has recently detracted from performance, explaining that CAR Group sits at the centre of the dealer ecosystem, and it combines proprietary vehicle and consumer data, strong brand equity and deep system integration with dealers. He believes AI will reinforce the advantages of scaled incumbents like CAR Group, who is already deploying AI to improve customer outcomes and strengthen its market position.
Miller also identified Jupiter Mines as a relatively unknown stock with significant potential. Jupiter Mines offers exposure to manganese through its stake in the Tshipi Mine. He pointed to Exxaro Resources’ strategic investment in Jupiter as validation of its asset quality, along with a net cash balance sheet and dividend yield, making it an attractive investment. He also views Perpetual, a financial services company, as undervalued, believing its strategic separation of divisions will unlock hidden value, particularly within its asset management business.
Reflecting on his investment approach, Miller shared advice from his father: “always buy quality stocks when everyone else is selling them, and sell when everyone is buying”. This contrarian philosophy has guided his career, focusing on acquiring high-quality businesses at a discount to their intrinsic value.
